American Express 2Q earnings jump, helped by Costco sale

NEW YORK (AP) — American Express said Wednesday that its second-quarter profit jumped 37 percent, helped by the sale of its Costco credit card portfolio and increased spending on its namesake cards.

AmEx sold the Costco portfolio to Citigroup, providing one-time after-tax gain of $677 million for the April-June quarter.

Costco announced in early 2015 it was ending its relationship with AmEx, adopting Visa as its exclusive network for processing credit cards and announcing Citi as the new bank issuer for its popular cash-back credit card.

Investors keep a close eye on card spending since AmEx makes most of its profit from taking a percent of each transaction used on its network.